There are competing legal analyses at play here. Can the state seize and sell assets in the abstract? Yes, they can. The most common type of disgorgement with which people are familiar involve Mafia, drug dealers and their planes and yachts and the occasional Ponzi Scheme guy such as Madoff and now Bankman Fried.Houstonag said:
I brought this subject up on an earlier thread and some on this board challenged the idea of property seizure and liquidation. I am glad to see in this thread some common sense in recognizing the obvious corruption in the legal system in the state of NY.
This system in my opinion is in violation of the US constitution.
But there is also a proportionality aspect to such seizures and forfeitures. Does the penalty fit the crime? And here, there is no crime alleged, it is a civil penalty for an alleged violation of a civil statute.And therein lies the problem. Criminal statutes must be narrowly drawn to provide notice of what behavior is not allowed. Criminal statutes that are too vague or too broad get struck down because they fail to provide such notice. Due process.
Here we are in the realm of GAAP, Generally Accepted Accounting Principles. So what does that mean? 3 out of 5 accountants agree and the other two are wrong? Something else? And this judge made findings of fact based solely upon a motion for partial summary judgment, which again are designed to be only appropriate as a matter of law, not fact.
This case will have to be sorted out in the appellate courts in the next few years. But in the meantime, those very wealthy people still living and doing business in NY state are rethinking whether it is time to leave.